Best way to make money off £5000-£6000

I have just had my 18th birthday and my old post office savings account can now be withdrawn. With that and the birthday money, I have around £5000-£6000 to put into an ISA or invest..

I know its not a huge amount of money so I'm not expecting a large markup, what would you suggest me do with the specified amount of money that I have?

Any details that you may need to know about me please say,

Cheers! :beer:

Comments

  • BLB53
    BLB53 Posts: 1,583 Forumite
    You could open a stocks and shares ISA with an online broker (I use Interactive Investor). Start a portfolio with a few shares. If you use their 'portfolio builder' option, you can buy each share for only £1.50 so it is economical to buy in smaller lots of say £500 per share. You could therefore buy 10 different shares with £5K.

    Personally, I would recommend higher yield blue chips from the FTSE 100 e.g Vodafone, Tesco, M & S, AstraZeneca etc. This is the best way to make money on the stockmarket over the long term but it depends what your objectives are. You might like more risk with small cap miners or oil drillers etc.

    Alternatively, look at investment trusts (research on Trustnet).
    Good luck!

    BLB
  • atush
    atush Posts: 18,731 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    At least half in a Cash ISA as you don't want to put all your savings at risk while you 'learn'.
  • Sceptic001
    Sceptic001 Posts: 1,111 Forumite
    atush wrote: »
    At least half in a Cash ISA as you don't want to put all your savings at risk while you 'learn'.
    Indeed, if it was my entire savings I would put it all in a cash ISA.

    If OP is interested in dabbling in shares, better to have a go with a virtual portfolio before jumping in at the deep end.
  • BLB53
    BLB53 Posts: 1,583 Forumite
    Indeed, if it was my entire savings I would put it all in a cash ISA.

    Only problem is, inflation at 5% is eroding the value of the cash ISA every year. With dividend shares, you will get a real return above inflation over the longer period and the possibility of a capital gain as well.
  • atush
    atush Posts: 18,731 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Inflation is a small risk as compared to someone who invested it all a mere 10 days ago or even worse, 3 months ago.

    If it is all your money and you are a novice, you are best not advised to trade in individual shares, and best advised to not invest all your money. Funds, after a cash buffer can be much safer.

    And any cash saved could easily be invested in the next series of inflation linked bonds by NSI when theya re released.
  • thor
    thor Posts: 5,500 Forumite
    Part of the Furniture 1,000 Posts
    BLB53 wrote: »
    Only problem is, inflation at 5% is eroding the value of the cash ISA every year. With dividend shares, you will get a real return above inflation over the longer period and the possibility of a capital gain as well.
    There is no justification to say that shares will increase in the long term. History is no indicator of the future.
  • crazyguy
    crazyguy Posts: 5,495 Forumite
    5 or 6000 scratch cards
  • Xbigman
    Xbigman Posts: 3,911 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    A cash ISA at 18, are you kidding? £6000 losing 1% a year to inflation for 50 years would be worth what, 4k(?) in retirement.

    Do you live at home?
    How much more can you put in each year?
    Do you have any vague plans for the money IE house deposit.

    Those are the questions everyone should be asking you.

    If it was a relative of mine, at 18, carefree and willing to risk the whole sum I'd tell them to put it in a stocks and shares ISA and buy CAD (Cadogan petroleum). (of which I am a holder myself).

    At 18 with a pregnant girlfriend, an expensive flat to pay for and a duff job its a different story. Thats where the cash ISA option comes in.

    Decide where you are between those extremes before you make any decisions.




    X
    Xbigman's guide to a happy life.

    Eat properly
    Sleep properly
    Save some money
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Save it into a cash ISA and use it towards the deposit on your first property.

    Consider a longer term fix rate to obtain a decent return.
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 349.9K Banking & Borrowing
  • 252.6K Reduce Debt & Boost Income
  • 453K Spending & Discounts
  • 242.8K Work, Benefits & Business
  • 619.6K Mortgages, Homes & Bills
  • 176.4K Life & Family
  • 255.7K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 15.1K Coronavirus Support Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.